Rumour: Bajaj-Kawasaki to break sales & service tie-up

According to media reports, Bajaj and Kawasaki are planning to end their sales and service partnership. Currently, Kawasaki bikes up to 650 cc are sold through KTM outlets in the country, which also takes care of their servicing needs. Bajaj owns 47% stake in the KTM brand and is responsible for all its operations in the Indian market. However, it is now reported that the Kawasaki-Bajaj tie-up will end in April 2017, after which, Kawasaki bikes will be sold only through dedicated Kawasaki dealerships.

Currently, Kawasaki has its dedicated dealerships only in tier 1 cities, through which, it sells the larger bikes that are brought in the country as CBUs. While its bikes are currently available at around 160 outlets thanks to KTM's wider network, once the partnership ends, the number of outlets will drop down to just 10.

The reason for the said breakup hasn’t come to light yet. Speculations suggest that since KTM is planning to expand its product portfolio, it would need larger showroom floor space. This, along with the fact that KTM bikes are a bit more profitable compared to Kawasakis, might have led to Bajaj taking the decision to step out from the partnership. Meanwhile, Kawasaki too might have decided to exit KTM dealerships, since its bikes often face competition from the aggressively priced KTMs.

Media reports further claim that despite the sales and service tie-up being called off, Kawasaki will continue to assemble its bikes at Bajaj's facility in Akurdi.

Source: MotorBeam